Energy Incentive Programs, New York

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Updated September 2015

Between its public-purpose-funded programs and programs offered directly by utilities, New York budgeted nearly $900 million in 2014 to promote gas and electric efficiency in the state.  

What public-purpose-funded energy efficiency programs are available in my state?

In 1998, as part of its electricity restructuring, the New York State Public Service Commission (PSC) designated the New York State Energy Research and Development Authority (NYSERDA) as the administrator of funding for energy efficiency and load management programs. These programs are paid for through a system benefits charge (SBC) on the electricity transmitted and distributed by six of the state's investor-owned utilities – Con Edison, Orange and Rockland Utilities, National Grid (formerly Niagara Mohawk), New York State Electric and Gas, Central Hudson Gas and Electric, and Rochester Gas and Electric. Customers of those utilities may apply for the NYSERDA programs. Customers of the Long Island Power Authority and New York Power Authority should refer to the section below on utility energy efficiency programs.

There are a number of NYSERDA’s energy efficiency programs that may be of interest to federal customers, including:

  • The Commercial Existing Facilities Program provides both pre-qualified and performance-based incentives. Pre-qualified incentives are tailored for smaller projects. Applicants can receive per-unit incentives up to $60,000 ($30,000 for electric and $30,000 for gas) for a variety of pre-qualified energy conservation measures such as lighting, HVAC, motors, furnaces, boilers, and interval meters. Performance-based incentives are available for more involved projects that produce verifiable electricity or gas savings. Incentives for electric efficiency are $0.12 per kWh of first-year savings in upstate locations, and $0.16 per kWh downstate. Gas incentives are $15/MMBtu upstate and $20/MMBtu downstate. There are also incentives for investments in energy storage, demand response, industrial and process efficiency, and monitoring-based commissioning. 

  • The Commercial New Construction Program provides technical assistance and design incentives for incorporating energy efficiency in building designs and evaluating potential efficiency opportunities; funding for the incremental cost difference between traditional and efficient equipment; and assistance for commissioning, peak load management, advanced solar, daylighting, and other green building technologies.  

  • Through the FlexTech program, financial support is offered on a cost-shared basis for feasibility studies, technical analysis of specific projects, peak load curtailment plans, data center efficiency analysis, retro-commissioning, and other types of engineering analyses performed by a pre-qualified consultant. 

  • Customers with electric demand of 100 kW or less may be eligible for free energy audits through the Small Commercial Energy Efficiency program.

NYSERDA maintains a comprehensive list of additional funding opportunities such as requests for proposals. 

What utility energy efficiency programs are available to me?

PSEG Long Island offers prescriptive and custom incentives for both existing buildings and new construction. Incentives include rebates for cool roofs and efficient chillers, HVAC, lighting, kitchen/refrigeration, and VFDs. Custom incentives and technical assistance are also available with pre-approval. Energy assessments are provided free of charge for existing facilities.

Central Hudson Gas & Electric offers natural gas rebates up to $1,200 for efficient space and water heating equipment, including boiler reset controls and programmable thermostats. Their electric efficiency program provides a free energy audit, then covers 70% of the cost of lighting or refrigeration upgrades, and offers 24-month no-interest financing for the remainder.

Con Ed’s Commercial and Industrial Energy Efficiency program provides a broad array of prescriptive incentives for both electricity- and gas-using products, ranging from low-flow pre-rinse spray valves to infrared heaters. A custom project option offers $0.16 per first-year kWh savings and $1/therm of first-year gas saved for projects reducing estimated gas consumption by less than 20%; a $2/therm incentive is available for projects with greater than 20% savings.  Installers must be participating contractors and project pre-approval is required. Incentives for both prescriptive and custom options are capped at 50% of the total project cost. Con Ed will also pay half the cost (up to $67,000) for energy efficiency project feasibility studies. ConEd customers with monthly electric demand less than 100 kW are eligible for a free energy audit, free installation of some efficiency measures, and rebates up to 70% on lighting, HVAC and retro-commissioning investments. 

National Fuel offers prescriptive rebates for the installation of efficient space- water-heating, and cooking equipment. A custom project option  pays $15/Mcf for first-year savings or 50% of the project cost, whichever is less. The maximum total incentive payment is $200,000. A similar set of rebates is available for customers with annual gas use of 12,000 Mcf or less, but has a maximum incentive payment of $60,000.

National Grid’s energy efficiency offerings generally include prescriptive rebates for a wide variety of equipment, custom incentives, and a direct-install component for small businesses. However, specific gas and electric measures covered vary depending on whether customers are located upstate, in Long Island/Rockaways, or in Metro New York. Incentives for Long Island/Rockaways customers may be limited; check National Grid’s website for more tailored information.

Rochester Gas & Electric (RG&E) provides incentives to their electric and gas customers who pay the state’s system benefits charge. Prescriptive electric rebates include lighting and controls, and certain high efficiency HVAC equipment. Gas incentives include efficient furnaces, controls, thermostats, and certain types of boilers. Custom incentives are available for both electric and gas measures with pre-approval, but the maximum payment for gas incentives is $100,000 per year. Currently there is no maximum for custom electric incentives. A direct-install program that starts with a free energy assessment is also available for electricity customers with demand of less than an average of 110 kW per month. 

NYSEG offers the same incentives and direct-install program as RG&E (see above).

Orange and Rockland Utilities’ Commercial and Industrial program provides prescriptive and custom incentives to customers who contribute to the system benefits charge. Prescriptive rebates cover efficient HVAC equipment, lighting, motors, and VSDs. The installation of VSDs as well as any custom projects require pre-approval. A Small Business program provides customers with an average peak demand less than 110 kW with a free energy assessment and pays up to 70% of the cost to install recommended energy efficiency measures.

 What load management/demand response options are available to me?

The New York Independent System Operator (NYISO) offers two conventional demand response programs along with a program that allows demand resources to participate in its day-ahead market for electricity and another that provides remuneration for acting as operating (aka “spinning”) reserves to the grid: 

  • The Emergency Demand Response Program (EDRP) provides financial incentives for electricity users to voluntarily reduce consumption and/or operate on-site generation during periods of electricity reserve shortage in New York.  NYISO typically provides 2-hour notice of curtailment events as well as day-ahead advisories (although in some cases immediate deployment is requested).  Participants receive the higher of $500/MWh or the real-time zonal Locational Based Marginal Price (LBMP) for their curtailments.  Participation in any curtailment event is voluntary, and there are no penalties for non-performance. Individual customers can either participate directly in EDRP (if their load reduction is at least 100 kW) or through an authorized curtailment service provider (CSP), such as a utility, energy service company, or curtailment customer aggregator.  Customers cannot participate in both the Emergency Demand Response Program and the Installed Capacity Special Case Resources (SCR) program (see below). EDRP and SCR are dispatched separately by NYISO, with SCR resources dispatched first, and EDRP customers called only if additional resources are needed.

  • The Installed Capacity (ICAP) Special Case Resources (SCR) program provides financial incentives for electricity consumers larger than 100 kW to reduce their electricity use or operate on-site generation during periods of electricity reserve shortage. NYISO provides 2-hour notice of curtailment events as well as day-ahead advisories. Participants receive two separate payment streams: a capacity payment based on their committed load reduction and energy payments for their actual load reductions during curtailment events.  Participants face non-compliance penalties if they do not curtail their committed amount when called by NYISO. Individual customers must participate through an authorized Responsible Interface Party (RIP) who coordinates transactions with NYISO, and cannot commit the same resources in both the Emergency Demand Response program and the SCR program.

  • The Day Ahead Demand Response Program (DADRP) provides electricity users with the opportunity to bid load reductions into New York’s day-ahead wholesale electricity market, where their bids compete with generators’ offers to meet the state’s electricity demand. At their discretion, customers can submit load reduction bids on a day-ahead basis by indicating the load reduction amount, price (between $50 and $1,000 per MWh), and time period.  If the customer’s bid is accepted and the customer fully curtails, they receive payment for their accepted bid, based on the greater of the bid price or the day-ahead LBMP.  If the customer fails to fully curtail, they will pay the higher of the day-ahead price (LBMP) or the real-time price for the amount of incomplete scheduled load reduction.  Individual customers can either participate directly in DADRP if their load reduction is at least 1 MW, or through an authorized curtailment service provider, such as a utility, energy service company, or a curtailment customer aggregator. Most of these providers require a customer to be able to reduce load by at least 100 kW in each hour.  Unlike in the EDRP and SCR programs, standby generators are not eligible for participation. Day-ahead participants can also be registered in EDRP. 

  • NYISO also offers a Demand-Side Ancillary Services Program (DSASP), through which loads can provide 10- and 30-minute non-spinning operating reserves. To participate, registered demand-side resources submit availability bids to the day-ahead market. If these bids are accepted, the demand-side customer is paid the market clearing price for that level of reserves (e.g., 10- or 30-minute). In return, the customer must comply with load reduction signals from NYISO. If the resource is asked to actually reduce demand in real time, it will also be paid the real-time market price for energy. If the customer changes its operating reserve offer in real time, the difference between this and the day-ahead reserve amount is financially settled at the real-time operating reserve price. A demand-side resource cannot offer the same capacity in the DADRP and DSASP on the same day.

NYSERDA’s Performance Based Demand Response initiative offers incentives for equipment necessary to participate in demand response programs, such as load-shedding controls and automation equipment. This program supports building of new on-site generation that meets New Source Performance Standards within Con Edison’s territory. Incentives are $200/kW in Con Edison and $100/kW elsewhere, and cannot exceed 75% of total project cost. Participants who receive incentives must enroll for at least two summers in either the New York ISO’s ICAP Special Case Resources (SCR) or DSASP program (see above), or a utility demand response program.  A bonus incentive of $100/kW (up to a maximum of $350,000) is also available to facilities with at least 100 demand response-enabled ENERGY STAR room air conditioners (including PTACs); similarly, enabled load-shedding ballasts are eligible for a $50/kW (up to $150,000) bonus. Both these bonus incentives require participation in the SCR program.

Along with the NYISO and NYSERDA initiatives described above, Con Edison customers can also take advantage of several demand response programs offered by the utility that are aimed at helping relieve congestion in its service territory. These programs include:

  • The Distribution Load Relief Program (DLRP), which gives participants up to two hours’ notice before an event. Events can occur between 6:00 AM and 12:00 AM seven days per week. Participants in the Reservation Payment Option commit to reduce a minimum amount if an event occurs and receive a monthly payment based on the amount pledged. For buildings in Tier 1 network the payment is $6 per kW per month and $1 for each kWh that is reduced during an event. The payment for Tier 2 buildings is $15 per kW per month and $1 for each kWh reduced. A voluntary option is also available in which customers do not receive monthly payments for a specific pledge, but receive $3 for each kWh reduced if they elect to participate in an event. A three-year commitment pays an additional $5 per kW pledged or reduced (whichever is lower) per month over three seasons of participation (each season lasts from May until September).

  • The Commercial System Relief Program (CSRP) provides 21-hour notice before an event, which can take place Monday - Friday and during their network’s specific call window. Participants receive $10 per kW pledged per month and $1 for each kWh that is reduced during an event. The voluntary option also pays $3 per KWh reduced. A three-year commitment pays $10 per kW per pledged or reduced (whichever is lower) per month over three seasons of participation.

  • The Steam Air-Conditioning Summer Discount Program provides steam customers located in Manhattan south of 96th Street with a $2 per 1,000 pound discount for steam used by new or replacement steam air-conditioning equipment (absorption or steam turbine) used during the high electricity demand months of May through October.

  • Customers with load-shifting capability can take advantage of ConEd’s Day Ahead Hourly Pricing rate, under which all power is charged at the day-ahead price. By gauging day-ahead pricing, customers can plan their load reduction strategies around high-price periods and, in turn, benefit from shifting load to lower-priced periods. To be eligible, facilities must have 15-minute interval metering, the cost of which may be offset under NYSERDA’s Performance Based Demand Response initiative (see above). Accounts with a peak load over 1,500 kW are defaulted into this rate if a competitive supply option is not chosen. 

Con Ed is also currently implementing a load-relief effort, the Brooklyn Queens Demand Management program, specifically in neighborhoods covering three electrical networks (Ridgewood, Richmond Hill, and Crown Heights) in Brooklyn and Queens. Con Edison is working with third-party energy solution partners, government agencies, and customers who can assist in providing critical load-relief in these constrained areas following the company’s approval from the New York Public Service Commission (PSC) to obtain 52 MW of non-traditional load relief via both customer- and utility-side solutions by summer 2018. The program is intended to help defer the construction of major utility infrastructure (including a new substation) for at least seven years. 

In addition, Con Ed has teamed with NYSERDA to offer the Demand Management Program, a joint effort to provide demand reduction incentives to customers for the following measure types: lighting, chiller/HVAC/BAS controls, thermal storage, battery storage, demand response enablement, and fuel switching (away from electricity). Incentives range from $800-$2600/kW for demand savings, in addition to $0.16/kWh for energy savings (for lighting and controls measures). All projects must be fully installed and operational by June 1, 2016 to receive the incentives. A minimum of 50 kW in demand reduction must be achieved during 2-6 P.M. on summer weekdays; customers are eligible for bonus incentives if their portfolio of measures reaches 500 kW of demand reduction.

What distributed energy resource options are available to me?

The Database of State Incentives for Renewables and Efficiency (DSIRE) provides information on other programs that offer incentives for renewable distributed generation. The following may be of interest to federal customers:

  • NYSERDA’s Solar PV and On-Site Wind programs offer incentives to install renewable electricity generation sources. Wind systems up to 2 MW are eligible for incentives based on the expected annual energy output. The maximum incentive for wind is $1,000,000 per site or 50% of total installed cost. For both programs, installation must be done by an eligible installer identified by NYSERDA.

  • The NY-Sun public-private partnership consolidated and expanded existing programs administered by NYSERDA, Long Island Power Authority (LIPA), PSEG Long Island, and the New York Power Authority (NYPA). NY-Sun offers incentives to commercial and industrial customers with solar electric systems over 200 kW that are based on annual energy production. The small business version on the program offers incentives for systems below 200 kW. 

  • PSEG Long Island’s Feed-in Tariff programs provide fixed payments for electricity produced by approved photovoltaic systems over a fixed period of time. Check site to see if applications are currently being accepted.

Are there energy efficiency programs sponsored by the state government?

Please see the section above on public-purpose-funded energy efficiency programs.

What additional opportunities are available to me?

Federal customers whose utilities have area-wide supply contracts through GSA (e.g., ConEd and National Grid) may be able to take advantage of 3rd-party financed energy efficiency projects called utility energy services contracts (UESCs). Information is available in GSA’s Energy Division Library. Federal facilities should contact their account executive to determine the level of each utility's participation.